Friday, January 23, 2009

[My apologies - a bug left a bunch of jargon at the bottom of the original post] It is reasonable to argue that the continued fumbling of climate policy in Canada can all be traced back to oil. It may finally come to a head this year.

Canada is a unique country. And no, not because it is that rare place where people apologize if you carelessly bump into them, although it is fair to say that Canadians do utter the phrase "I'm sorry" more often than any other people. Canada's unique because it is the only developed country that is both a large energy consumer and a large energy producer. The Canadian economy is largely based on resource extraction -- gas, mining, forestry, and the big kahuna, oil.

The history is well known: The oil-producing province of Alberta opposed signing Kyoto. For years, the leaders of Alberta and the news media regularly attacked climate science and climate policy. The Alberta-based opposition to reducing greenhouse gas emissions, represented federally by the Reform-cum-Alliance-cum-Conservative Party, was one of the major factors hindering the ability of the former Liberal governments to implement of any policy to meet the Kyoto targets. When the Conservatives took over the government, they effectively suspended any serious federal effort to reduce greenhouse gas emissions.

Today, oil extraction from the Alberta tar sands has become such a large part of the Canadian economy that even those public figures who by all rights oppose the developments for environmental and climatic reasons are unwilling to go on the offensive for fear of losing public support out west. Case in point new Liberal Leader Michael Ignatieff's pragmaticstance on the issue.

Canada has gone from being the toast of the world for ratifying Kyoto despite US opposition to the scrooge, actively lobbying the new US government to weaken its climate policy. Nervous that the Obama Admistration will regulate carbon-intensity of fuels -- effectively outlawing oil from the tar sands -- the Canadian government is doubling down. The new idea is that the US and Canada should harmonize their climate policies, and that those policies should make an exception for oil from the tar sands. Why? The pitch is that Canada is the secret to solving US energy woes: a large, friendly source of oil.

Will Canada be able to use oil as leverage? Rob Silver of the Globe and Mail is not so sure:

... when people talk about "Canada" or the "Canadian Prime Minister" using our oil resources as negotiating leverage with the U.S. administration, I'm not sure what legal basis the Prime Minister could possibly have to trade off additional or reduced oil development for, say, arctic sovereignty concessions. It's not the Prime Minister's oil to negotiate with. The Prime Minister is little more than lobbyist in chief - and that presumes that the PM and the oil companies' interests are aligned. This makes Canada different from almost every OPEC oil country, where the head of state and the oil production company are one and the same, and thus negotiating oil for other concessions is fully within the leader's power.

Regardless, Silver rightly concludes that even if Canada has leverage, Canadians might not want to use it:The question our leaders need to ask, however, is whether we want to use whatever leverage we may have with the U.S. to fight against Obama's climate change plans. That seems to be where these suggestions are heading, and I both question the efficacy those efforts are likely to have and whether that puts us on the right side of history.